The idea that government spending creates jobs makes sense only if you never ask where the government got the money. It didn’t fall from the sky. The only way Congress can inject spending into the economy is by first taxing or borrowing it out of the economy. No new demand is created; it’s a zero-sum transfer of existing demand.
This, in a word, is bullshit. The concept of "borrowing money out of the economy" is a non-sequitor--if anything, money is borrowed into the economy, in the sense that every dollar borrowed is a dollar spent (in other words, people don't borrow money just to stuff it under a mattress--they borrow money with something to buy in mind, like a house, car, etc.).
In fact, normally the main mechanism by which the economy is regulated is by manipulating the amount of borrowing going on. This is accomplished by the Federal Reserve, which has its finger on the interest rate--lowering the rate makes borrowing cheaper, and so more borrowing--and therefore more spending--takes place. And more spending==increased demand==stimulus (these are just semantically equivalent terms).
The problem these days is that the Federal Reserve can no longer increase demand amongst the private sector by lowering the interest rate because the interest rate is already at zero (or near zero--I think it's like 0.25% or something). And so the federal government has stepped in to shoulder the burden, borrowing--and spending--hundreds of billions of dollars on its own. I have a feeling Riedl wants to say something like, "yes, but this demand is canceled out by the fact that the money will have to be repaid later via taxes", but this is no different in principle than the fact that the car or house-buying private citizen needs to eventually repay the loan that was taken out. Obligation to pay down debt later doesn't negate the fact of money being spent now, whether you're talking about a private individual, a company, the government, or whatever.
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